Implications of drugs with rebate in Europe

In 2018, the health expenditure on cancer care in Europe: EU-27 plus Iceland, Norway, Switzerland, and the United Kingdom was 103 € billion, 32 € billion of which was spent on cancer drugs [1], (roughly 31% of the expenditures on cancer care). In this scenario, characterized by costly treatments of rather low value [2,3], several European countries started negotiating the price of new drugs with the manufacturers, with the aim of obtaining discounts which allowed more patients to be treated (or to spend less for the treatment of the same number of patients). This habit has rapidly spread across Europe and several countries obtain “confidential rebates” which, being confidential, are not publicly available. Such rebates are based on different pricing models, including a fixed partial reimbursement per administered drug, revenue on exceeding sales volume, pay for performance models and appropriateness agreements (aimed to enhance the appropriateness of prescriptions through the management of patient registries) that falls under the category of “Managed Entry Agreements” (MEAs) [4]. Appropriateness agreements are quite popular in Italy for innovative drugs, often labelled for onco-hematological indications, mandate the filling up of web-based registries prepared by the Agenzia Italiana del Farmaco (AIFA) and are very burdensome for oncologists who have to do a lot of paper work to get the drugs for their patients [5] The prevailing idea is that these agreements are good for patients and help saving money but there is still little information on the quantitative impact of their introduction, hampered by the confidential nature of the agreements (in some cases, it is not even known whether an agreement exists). Gamba et al. [6], used a theoretical model which was confirmed by an empirical analysis of a sample of 156 medicines in six countries to show that under most price setting regimes, MEAs are associated with a 5.9% increase of the price list.

In the article accompanying this commentary, Carl and Vokinger [7] assessed new drugs which entered the market in Switzerland between 2012 and 2020 with (n = 51, the majority, 32, are cancer drugs) or without (n = 376) some forms of MEAs. They concluded that although rebates with median reduction of 27% (EUR 1538) per month of treatment, was economically relevant, they could delay access to drugs (106 days for drugs without rebates, 302 days for drugs with rebates) and lead to overpayment. The rebates do not improve the value of drugs since only 15/51 (29%) were of high clinical benefit (according to the Federal Joint Committee of Germany). Applying the ESMO-MCBS, a scale with which Oncologists are more familiar, but currently developed only for solid tumors (23 drugs in the study) 12 (52%), cancer drugs with a rebate had a high benefit and 11 (48%) had a low benefit. While it is understandable that the procedure aimed at finding an agreement between National Authorities and Manufacturers can delay patient's access to new drugs the negative impact of these deals on drugs price is somehow counterintuitive and not supported by the data presented, although in line with previous literature [8]. However, this study is important because it lends support to the May 2019 resolution of the Assembly of the WHO [9] that urges member states to be transparent regarding the mechanisms applied to defining the price of new drugs. It also sent a message to the negotiators at the national levels that the goal of the European Commission to ensure access to drugs for patients in Europe at an affordable price, may not be achieved with the strategy of drug pricing models rebates.

So, what can be done to curb the seemingly unstoppable increasing cost of drugs, mainly in the field of oncology? We believe that the magic words should be transparency and value. Transparency must be undertaken by the pharmaceutical companies that should make the costs sustained in research and development available to the public. These costs are often emphasized but are probably around one third of the revenues [10]. The added value of a new treatment should be priced according to the benefit (preferably gain in survival but also the delay in progression is acceptable since it is an important aim for patients). In conclusion, the application of M.E.A.s, aimed at granting access to innovative drugs at a reasonable price, might end up with the unwanted consequences of not only lengthening the process and worsening an already heavy bureaucratic burden but also determining the actual increase of the drug's marketing price. A situation reminiscent of the “Heterogenesis of ends”, an expression formulated in 1886 by German psychologist Wilhelm Wundt to denote unintended consequences of wanted actions.

Disclosure: No funds were received to support this article.

Authorship: All Authors contributed equally to (1) conception and design, acquisition of data, or analysis and interpretation of data; (2) drafting the article and revising it critically for important intellectual content; and (3) final approval of the version to be published.

Declaration of Competing Interest

The authors have no relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript. This includes employment, consultancies, honoraria, stock ownership or options, expert testimony, grants or patents received or pending, or royalties.